Recently, a photographer filed a copyright infringement lawsuit against Capcom, alleging a series of instances where the video game publisher used her photographs without permission.
In this post, I’ll break down the facts of the case as alleged by Judy Juracek, the photogapher, and discuss some ways that Capcom might mount a defense. I’ll also discuss how you can avoid this situation for your own games.
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Fast facts about the case:
Date: June 4, 2021, District Court of Connecticut
Plaintiff: Photographer Judy Juracek
Defendants: Capcom CO Ltd. (Japan) and Capcom USA, Inc. (USA)
What’s the main legal issue? Copyright infringement and removal of “copyright management information” (which means that the copyright notice was removed or cropped out of images)
So, what happened here?
Juracek, a photographer, released a book of photographs called “Surfaces” in the 90s. The book had an accompanying CD-Rom featuring the images in the book. These images were made available for licensing to third parties.
The complaint was filed by Juracek on June 4, 2021 in Connecticut District Court. It alleges that various Resident Evil games published by Capcom contain a large number of her copyrighted photographs, yet Juracek never granted Capcom a license to use those photos.
I’ve made the complaint available for download here. It’s a short read, so check it out for the facts as fully alleged.
The complaint contains a few examples of this copying, including the shattered glass contained in the background of the Resident Evil 4 logo. See the image below:
In one other instance, a design used on one of the mansion doors in Resident Evil 4 matches one of Juracek’s photos almost exactly. According to the complaint, this particular photo was taken inside a Rhode Island mansion with no public access. Therefore, Juracek alleges, there’s no way for Capcom to have gotten the photograph themselves.
Additionally, Juracek mentions a 2020 hack of Capcom’s servers which revealed full resolution versions of these photos on Capcom servers, with identical filenames to those on Juracek’s CD of copyrighted photographs.
The complaint alleges that over 80 images were used in Capcom’s various Resident Evil games, with a total amount of potential statutory damages equaling $12 million. Additionally, the allegation of removal of copyright management information brings with it a statutory penalty of up to $25,000 per image if proven true.
If Capcom CO Ltd. is a Japanese company, how can they be sued in the United States?
One of the important aspects of US law is something called “personal jurisdiction.” This basically dictates which court has jurisdiction over a person, company, or foreign entity, in this case.
For Capcom CO Ltd., despite being located in Japan, they sell their products worldwide. Presumably, they sell a good amount of product in Connecticut, where Juracek sued them. The sale of products in a jurisdiction establishes a certain amount of contact there – see this line from the complaint:
“Defendants have purposely availed themselves to this state and this district at least
because they have promoted and sold their infringing products to consumers in this state and
district.”
Because they meet the “minimum contacts” test for personal jurisdiction, they can be sued there.
How do you sue for copyright infringement and how can you prove it?
First, you need to have something copyrightable. In this case, a photograph is probably good enough.
Next, you need to have a copyright registration. You can’t have just applied for one – the registration must have been issued. See my post here for more info on copyright registrations.
Proving copyright infringement requires two things:
- The alleged infringer has to have had “access” to the copyrighted material
- The alleged infringer’s use of materials has to be “substantially similar” to the copyrighted material
In this case, both of these appear to be met. For the first requirement, the book and CD were publicly released and purchasable, and if the allegations are correct there is evidence that Capcom has the specific files on their servers.
For the second requirement, at least the examples given in the complaint show more than just “substantial similarity” – they show the copyrighted material actually being used in the infringing material.
It’s not clear how direct the rest of the alleged uses are (the complaint mentions additional pages but they are not in the publicly available complaint on PACER).
What defenses does Capcom have here?
There are various defenses that Capcom could answer with, such as:
- That the materials aren’t copyrightable in the first place (doubtful)
- That there WAS a license agreement in place (the photographer doesn’t seem to be aware of this, but I suppose it’s possible)
- That their use of the photographs is a “fair use” (doubtful)
- That Capcom created the work independently
- That the 3-year statute of limitations has run out
A lot of these are tough to show, but we’ll have to see what happens when they file an answer to the complaint. It’s due by June 25th – I’ll update this post when it happens.
What will likely happen here?
With most legal disputes, the most likely course of action is that the parties get together and settle out of court. Given the length of time a lawsuit takes and the costs involved, more than 90% of cases which are filed end up settling.
If the usage of copyrighted material is as blatant as it appears to be in this case, unless Capcom has a legitimate defense to the allegations, I’d imagine this will settle soon. Usually these settlement agreements release each other of all potential claims and require that both parties keep everything confidential.
And of course, there’s usually some money that changes hands. The actual settlement amount will most likely never be known.
How can you avoid this happening to your own game?
The lesson for game developers here is to make sure that you have the rights to EVERYTHING that goes into your game.
- If you hire employees to create game assets, make sure you’ve got an employee Invention Assignment Agreement that clearly assigns you the rights to their creations
- If you hire contractors, make sure you’ve got a written contractor agreement, which has “work made for hire” or assignment language in it
- If you’re licensing materials from a third party (game music, texture photos, 3D models, software code, etc.), make sure that you have a license agreement in writing and that the license is broad enough to give you enough rights to use the materials in your game. We want it to include any remakes, ports, sequels, prequels, derivative works, etc. if possible, so you don’t need to go back to the well to ask for more rights later on.
You also want to make sure you audit what’s in your game to make sure there’s proper “chain of title” for everything – you don’t want any employees slipping copyrighted content that you don’t have rights to into the game. Make sure your contractors who use elements like photo textures, Unity Asset Store assets, and other game asset marketplaces actually HAVE the rights to the materials they say they’re granting to you.
Seriously, you want to SEE those agreements and invoices to confirm ownership.
While your agreements with your developers may have indemnification language saying they’ll defend you in court, this is only worth as much as the paper it’s printed on. In this Capcom case, there’s potentially $12 million in damages – does the average game dev independent contractor have that kind of money to cover their screw ups?
Take the responsibility and double check ownership on everything in your game. You don’t want copyright claims coming for you down the road.
Need help getting all these contracts in place? Check out my legal services price list for more info on my various indie game studio startup packages and other flat fee game legal services or click here to contact me.
